Analyzing The Legal Details Of comiXology Submit

ComiXology recently made news with the launch of comiXology Submit, a new program allowing independent creators can submit their work at no cost to be sold via the publisher's digital storefront. If comiXology decides to sell the project, then the creator will split the profits with comiXology. This is certainly a notable new avenue for independent comic creators, and already some creators -- including Shannon Wheeler and Becky Cloonan -- have signed up. In the wake of the announcement, CBR decided it would be a good idea to examine comiXology Submit's Submission Agreement and License Agreement to see if there are any areas of concern in the agreements for creators curious about this new endeavor.

Let's begin!

After examining the two agreements, I've come up with two main points creators should strongly consider before submitting their projects to comiXology Submit.

Is this the best deal that you can get?

This is something that I cannot answer for you. The basic set-up sounds fair enough, but obviously you know your sales figures better than anyone else, so you have to do the math on it, much of which has to be speculative. Is the higher visibility from being on comiXology worth the 50% cut that they take after whatever expenses they take out?

Do you trust comiXology?

The "50/50 split after expenses" aspect of the contract is potentially worrisome. Specifically, the passage in the License Agreement which notes the various expenses deducted before getting to the 50/50 split: "[F]ees payable to any channel partner or distributor of comiXology (for example, various App stores)" and "affiliate fees payable for sales on the Internet."

In effect, you have to put your faith that comiXology is being reasonable with the expenses deducted from your gross sales before splitting the remaining money with you. I certainly am not saying you shouldn't trust comiXology or that they are not being reasonable. I'm just noting that in a contract like this, you are essentially placing yourself at the mercy of someone else's accounting and these clauses create plenty of loopholes.

Beyond that, there are no real red flags in the contract. The intellectual property ownership sections of the agreement in particular are strongly in favor of the comic creator. There does not seem to be anything to worry about there. It is also good to know that the agreement is not exclusive, so you can continue to sell your work elsewhere online. However, it is worth noting that the term of the agreement is for five years, which is a rather long time to be tied to comiXology, especially if you find yourself feeling that you could get a better deal elsewhere. Which is why it is all the more important that you consider the two questions above. It is important to point out that the agreement only applies once you have actually submitted your final content to comiXology, so you have until that point to back out if you do not wish to lock yourself in to the deal for five years.

There is a potential issue when it comes to pricing. You are able to determine the price point on your individual comics, but comiXology has sole discretion over pricing when it comes to bundling your work. In effect, they can "bundle" individual issues and sell them at a price cheaper than the normal sum of each of the unbundled issues. While "sole discretion" is never a great thing to see the other side have in a contract, here you are protected by the simple fact that their interest is the same as yours. It does not make sense for them to price your bundled work too low, as they are splitting the money with you. However, it is worth keeping in mind that they do have the sole discretion when it comes to pricing bundles of your work. In addition, they can give away up to 20% of your work for promotional purposes, but that sounds very reasonable.

The indemnification clauses in the license agreement are lopsided in favor of comiXology, but honestly, that is reasonable enough in this situation. There's very little that comiXology can do that would require them to indemnify you, while there are plenty of issues like plagiarism or any other sorts of intellectual property rights violations that could cause major problems for comiXology. In the limitation of liability section of the submission agreement, though, comiXology tries to make a claim I don't believe would be allowed under New York law, specifically noting: "IN NO EVENT WILL THE LIABILITY OF THE COMPANY TO YOU EXCEED $100." It is unlikely that that would be enforceable.

ComiXology can assign and/or delegate this license to a third party without restriction, so while it is does not seem like comiXology is going to be going anywhere any time soon, it is fair to say that five years is a long time, so you might find yourself working with a different company in 2018. That's a normal risk, though.

When it comes to Governing Law, there is a notable mistake in their agreement. They specify "Manhattan County," which does not exist. That should read "New York County."

In total, legally both agreements (besides the Manhattan County mistake and the likely overreaching Limited Liability clause) are reasonable. Your decision whether or not to accept the deal should therefore be predicated on issues outside of legality, specifically the two business questions we asked at the beginning of the article. Is this the best deal you can get? Do you trust comiXology? Only you can provide the answers to these important questions.